MARA Holdings, Inc.

and gentlemen, welcome to Marathon Digital Holdings first quarter 2024 earnings webcast and conference call. I would now like to turn the call over to your host, Robert Samuels, Vice President of Investor Relations. Please go ahead.

Thank you, operator. Good afternoon and welcome to Marathon Digital Holdings first quarter 2024 earnings call. Thank you for joining us for our call today. With me on today's call are our Chairman and Chief Executive Officer, Fred Thiel, and our Chief Financial Officer, Salman Khan. Before we get started, I'd like to remind everyone that our prepared remarks may contain forward-looking statements and that we may make additional forward-looking statements during the question and answer session. These forward-looking statements are subject to risks and uncertainties, and actual results may differ materially. When used in this call, the words anticipate, could, enable, estimate, intend, expect, believe, potential, will, should, project, and similar expressions as they relate to Marathon digital holdings are as such a forward-looking statement. Please refer to our earnings release for a full recitation of our forward-looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those anticipated by Marathon at this time. Some of these risks and uncertainties are more fully described in Marathon public filings with the U.S. Securities and Exchange Commission, which can be viewed at www.sec.gov and ir.mara.com. Finally, please note that on today's call, we will refer to certain financial measures that were not prepared in accordance with generally accepted accounting principles in the United States, including adjusted EBITDA and non-GAAP total margin. Marathon believes these non-GAAP financial measures are important indicators of its operating performance because they exclude certain items that are unrelated to and may not be indicative of its GAAP financial results. Please refer to our company's periodic reports on Form 10-K and 10-Q and to our website for a full reconciliation of these non-GAAP performance measures to the most comparable GAAP financial measures. As usual, we'll begin today's call with prepared remarks from Fred and Salman, After their comments, we will be going through some of the more popular questions from investors before transferring to a live Q&A with our covering analysts. And with that out of the way, I'm going to turn the call over to Fred to kick things off. Fred?

Thank you, Rob. The first quarter of 2024 was one of our most transformative to date. We officially transitioned Marathon from being an asset-light Bitcoin miner and laid a solid foundation on which we are building this organization into a globally diversified company that leverages digital asset compute to build a more sustainable and inclusive future. During the quarter, we significantly grew and improved the resilience of our portfolio of digital asset compute by acquiring and integrating our first fully owned and operated Bitcoin mining sites. At the end of last year, our portfolio consisted of 584 megawatts of capacity, only 3% of which we directly owned and operated. In less than four months, we initiated, negotiated, closed, and integrated our first two acquisitions comprised of three sites, the first two being the sites in Granbury, Texas, and Kearney, Nebraska, and the second being the site in Garden City, Texas, that is adjacent to a wind farm. We purchased these assets for approximately $458,000 and $437,000 per megawatt, respectively, which is approximately half the cost of what some of our competitors have paid to build new sites. In Q1, we effectively doubled the size of our portfolio to 1.1 gigawatts of capacity, and we gained far more direct influence over our operations by taking direct ownership and operation control of 54% of the portfolio. We did this while generating significant savings for our shareholders relative to building sites the way our competitors have, and we quickly gained enough capacity to meet our near-term growth targets of 50x a hash by the end of this year. As we cost effectively laid this path to accelerate our scale and enhance our operational influence, we also launched our first products and services as an organization, each of which demonstrates our commitment to expanding and diversifying revenues by creating advanced technologies that transform digital infrastructure and diversify our revenue streams. In February, we launched Slipstream, which is a direct Bitcoin transaction submission service that is designed to streamline confirmations of large or non-standard Bitcoin transactions. In essence, it provides sophisticated users with a simple, transparent, and trusted means of adding complex Bitcoin transactions to the blockchain, provided they adhere to Bitcoin's protocol, and it provides Marathon with an opportunity to increase revenue by capturing more transaction fees, which is particularly advantageous in a post-hatting environment. Although the service is only a few months old, it has already proven valuable. Last month, just before the halving, we earned an additional 4.25 Bitcoin from Clipstream alone. Mara Pool, which powers Clipstream, captured one block with 10 Bitcoin in transaction fees and another with 16, generating nearly 10% greater fees than FPPS pools at the time. While these numbers are small relative to our overall production, Slipstream serves as a tangible example of the strategic importance of operating our own mining pool, of being at scale, and of deploying our proprietary technology stack. As a matter of fact, if you were to look at the mempool.space for the past week and look at mining pools, you would see that Marathon's pool performed 40% above average. As we demonstrated in March, Slipstream was just the beginning. During the first quarter, we also brought our first products to market. all of which contribute to one of our key competitive advantages, our vertically integrated tech stack, and provide us with an opportunity to diversify our revenue streams. These products include our industry-leading Mara firmware, controller board, and two-phase immersion technology, which we call 2PIC. We showcased each of these products at the Empower Conference in March, and the reception was overwhelmingly positive. We already have paying customers for our firmware, and 2PIC has a pipeline that is in the tens of millions of dollars and growing. We're currently integrating 2PIC at some of our own sites, which is part of our strategy to optimize our performance by increasing uptime, improving efficiency, and reducing maintenance downtime and cost. For the market, our goal is to begin shipping these systems in volume to third parties by the end of this year. While the quarter was highlighted by the significant expansion of our portfolio of digital assets compute, and the launch of our first products and services geared towards transforming digital infrastructure, our Bitcoin production was negatively impacted throughout the first quarter by unexpected equipment failures, predominantly transformers at our third-party hosted sites, utility company transmission line maintenance, and the higher-than-anticipated weather-related curtailment across multiple sites. However, I'm pleased to say that we have mitigated a number of these issues and are currently operating at a record-high level of 27 exahashes. While there will always be the potential for exogenous events that impact operations, we believe we can mitigate their impact over time as we continue to scale, standardize equipment, diversify globally, and build redundancies, and leverage economies of scale that stem from owning and operating multiple sites around the world. In the meantime, we can always control how we respond to challenges, and just as we always have, our team quickly began working on solutions that were within our control. We were able to immediately take advantage of the newly available capacity from our recent strategic acquisition. Once it became clear that the transformer issues at Ellendale were more complicated than originally believed, our team quickly began reallocating miners from this site to Garden City, where there was available capacity. We successfully moved 9,500 idle miners from Ellendale and simultaneously began energizing new machines to expand our capacity. Our ability to adapt combined with the uptime improving across our sites These challenges were resolved, enabled us to achieve an all-time high operating hash rate of 27 exahashes this month. The transformer issues that negatively impacted our ability to convert megawatts into terahash and therefore Bitcoin have been challenging, but with our hash rate continuing to grow to record levels, we have clearly been able to work through the challenges and to execute. And fortunately, the resilience we've built into our diversified portfolio, our ability to adapt to change, and changing circumstances and our huddle strategy allowed us to still capitalize on Bitcoin's positive momentum. Despite the operational challenges, we still produced record financial results during the first quarter. To unpack our financial results, I'm now going to turn the call over to Salman, who will cover the results in more detail. Salman?